Using Robinhood Chain over the last few days, along with Base, to do DeFi and earn with MaxFi has changed how I see the future of crypto. Right now I'm just printing money on MaxFi with all these liquidity pools, and if you want to get in on that, you can join through my MaxFi referral link and watch some of my other videos about it. This is not going to be a video about that, though. It's about seeing the direction crypto is going. And this is really bad for layer ones like Solana, Avalanche, and Sui, and potentially even big ones like Tron and XRP.
Who already has the customers?
Here's what I'm seeing with Robinhood. In the past, a lot of people have looked at crypto as, who's the fastest chain, which one can get more users. At this point, if you're looking at crypto adoption in the future, you've got to think about who already has the customers, and what they're going to do with those customers. If you look at Robinhood, they already have all the customers. And what did they do? They launched their own Ethereum layer two. What did Coinbase do? They launched their own Ethereum layer two. You've got Kraken, you've got all these banks and big companies that have all these customers, and they want to make money off them, and they want to maintain as much control as possible. Right now we're seeing a meta with Robinhood Chain that looks like it's going to keep going in this direction: instead of using things like Solana, Sui, Aptos, or any of these other chains, the plan is to just go with Ethereum layer twos.
One Ethereum layer two is pretty easy to interact with and bridge over to another. You've already got all kinds of DeFi liquidity in Ethereum. And the more you have things like Base, Ethereum, and Arbitrum blowing up with a whole bunch of transactions and users on them, the more attractive it is, if you're a bank like JPMorgan Chase or whoever, to launch your own Ethereum layer two, because then everybody on Robinhood and Base can easily just move over and start using yours. You can have all the same kinds of meme coins and stock tokens on your chain as they do on the others. The EVM compatibility and the ecosystem all working together is an unbelievable advantage.
Why my positions are printing right now
You can see that in my own example. I took a few thousand dollars of USDC that I borrowed against my ICP so I could play around with all these meme coin positions and start making a couple hundred dollars a day, like I've shown you. I literally set this up within the last 24 hours. Most of these positions were set up in the last 24 hours, and they're absolutely printing money. That's because Robinhood Chain is hot right now, and there's not enough liquidity on it compared to all the users, which is likely to be the case somewhere else next. It's easy to spin these EVM chains up, whoever spins one up has control over it, and then it's easy for Ethereum DeFi from other chains and from Ethereum itself to come pouring in.
So if I'm an institution looking to get into crypto and I want to make money for myself, which is generally going to be the interest of any institution, there's no reason, as far as I can see, to try and do anything with Solana, when Coinbase and Robinhood have already proven that having your own Ethereum layer two appears to be the meta. How's this going to play out? The more Robinhood and Coinbase show off how well their Ethereum layer twos are doing for them, the more institutions are going to do it. If you're going to be the next Robinhood, the next bank that wants to get into blockchain and make all these profits, and there are huge profits to make from all these meme coin trades and fees, then with your own Ethereum layer two, Ethereum is hardly getting any of the revenue on the base layer and you're just printing money yourself. If you're the next Robinhood, you've already got the customers, the app, the compliance infrastructure, the relationships, and the assets. Would you think, I want to do something with Solana? Or would you notice that Robinhood and Base are already blowing up, and all the people on them can easily pop over and use yours if you make it an Ethereum layer two too?
The other layer ones have an expiration date
This is making it pretty obvious that these other layer one chains, unless they have a very clear purpose and something they do better than anything else, are watching the future go toward Ethereum layer twos. That has some value for the Ethereum coin, because it can go back and forth across the ecosystem infrastructure. As you're seeing, this isn't necessarily generating a lot of value for the Ethereum coin at the main layer, but it can help increase the value of Ethereum as people need to pay Ethereum fees, and those fees get transacted a whole bunch on these layer twos. But the more Ethereum wins, the more EVM wins, and the more these layer twos get set up, the more value is going to pour out of all the other ecosystems.
The more meme coins there are on these chains, the more money I'm printing, and I'm not having to create or launch meme coins. I'm just getting paid off people swapping meme coins on Robinhood. I make these positions clear in my other videos and explain them. And this is not unique to me. It is risky, and certainly my portfolio has gone down some, but I've got hundreds of dollars more in crypto than I had before too, so it balances out. Then when prices go up, my portfolio goes up and my earnings are worth more. If I'm able to do this sitting on Robinhood, then why are other people going to sit on Solana, Avalanche, and Tron? Why are they going to park all their money in these other coins when the action is on Ethereum layer twos? To me, this is a warning sign that a lot of these other layer ones have an expiration date.
Stock tokens are what make this bigger than meme coins
The Robinhood stock tokens are what make this much more important than meme coins. I'm not using the stock tokens on Robinhood, because it's a pain since I'm in the US. But Robinhood has made all these stock tokens available on their chain, which gives a very clear reason to come over and start using their specific chain. They've already got all that set up, and then they can bring meme coins in on top of it and get huge volume. Once you have something like Robinhood set up already, the logical thing for somebody else to do is just come over and start using it, and then copy and make the same exact thing, instead of trying to do something much more difficult like building all of that out on Solana.
So the question is, when you look at all these other chains, Solana, Avalanche, Cardano, Aptos, what are they going to do that competes with something like Base and Robinhood? To me, Base and Robinhood are the barometers. They're absolutely sucking up the TVL and pulling the liquidity in. They're where the action is right now, which means they're the hot places to launch meme coins too, and then they have stocks on top. If you see where this is going, and you're just sitting there holding your Solana hoping the price goes up, or holding Cardano hoping Charles Hoskinson is going to do something, why would you do that when this is where the action is, and this is where the institutions are signaling that they're going?
BNB Chain as the historical comparison
You can look at BNB Chain as an interesting historical comparison. BNB basically made their own version of Ethereum, but as a layer one with an EVM network instead of a layer two. That was the meta before: make your own Ethereum fork, or basically copy it. But that's more difficult to interact with today. The fees and the bridging are much more complicated, and the layer twos are making things so easy and so fast. They are so centrally controlled that it's much easier to just do your own version of Arbitrum, like Robinhood did, and spin that up.
This is fake DeFi, and it's not ideal for users
Yes, this is not ideal for users at all. It's absolutely centralized. Robinhood and Coinbase can control whatever they want on their Ethereum layer twos. It's very centralized, and it kind of ruins the whole point of DeFi. For example, if you're trying to swap stock tokens on Robinhood using Uniswap or another interface, the centralized front ends will block you from even swapping those if you're in the US. This is not the best situation for users. It's kind of fake DeFi, where it feels like DeFi and you can do a lot of things, but the centralized front ends and the centralized entities controlling everything are making almost all the money, and they still have almost all the power. It's just in a more regulatory-friendly environment.
The future could be a whole bunch more things like Robinhood and Coinbase, and it's just so much easier if that's what all the customers and institutions are launching on. It makes so much more sense than doing anything on Solana, or even making another chain. You've got Base, you've got Robinhood, and then you'd have Chase Chain or JPMorgan Chain, and maybe Berkshire Hathaway or whoever, everybody coming out with their own version of EVM. Then you could bridge and use all your assets across all of them super easily: a Visa chain, a Fidelity chain, a social media chain, a Meta chain. And all of it would be centrally controlled. Your funds would basically not be your own, even if they're in your wallet. They're very easy to KYC, very easy to freeze, and all the front ends are controlled.
Where ICP fits: the worst case for the other layer ones
Where this unwinds even more is here. It would be one thing if there were no layer one that truly differentiated itself. Solana, Avalanche, Aptos, and Cardano don't truly differentiate themselves. They're all very similar to Ethereum with fairly incremental technical changes. But on top of all this, there is Internet Computer Protocol, which is the most advanced technology in crypto by far. My website, jerrybanfield.com, is hosted on Internet Computer Protocol. And that makes the absolute worst case for the rest of the layer ones, because you do have one layer one, ICP, that really can do almost everything, and it can do it all fully on chain. None of the other layer ones are even close technically to being able to do that.
Then you have Bitcoin, which is already the top crypto in terms of branding, the gold standard, while Ethereum is truly the largest community, especially as these layer twos get built out. So to me this leaves a future where the three main things in crypto are Bitcoin, Ethereum, and ICP. Almost nothing else is hardly even needed. ICP, as the most advanced technology, solves for things like governments that want sovereign infrastructure and can build on chain. I have a dedicated Jerry Banfield ICP channel where I go on and on about ICP, if you want to see why it's the best technology and what all that's about.
The thing with ICP is this: when you combine institutions pushing their own Ethereum layer twos, which is the easiest, most profitable, most transactable thing for them to do, with a technology that makes all the other layer ones irrelevant, the only thing keeping you on any blockchain is its customers, its action, and whether you can make money on it. This is crypto. I dropped being an ICP maxi because I'm printing money on MaxFi on Robinhood. But when whoever it is launches the next Ethereum layer two, I'll be over there printing money on that. And when governments and companies onboard to ICP for the technology, I'm there, because I'm already holding ICP. To me, the future of crypto in the short term is Ethereum layer twos, and in the long term it's ICP, and almost everything else is desperately trying to keep up and stay relevant. It's a difficult sell to tell me that Solana, Avalanche, Sui, Aptos, Cardano, XRP, and Tron are going to be relevant in the face of institutions running their own Ethereum layer twos and ICP scaling out the internet with new blockchain-based infrastructure. I don't see it. So in the short term, I'm most bullish on Ethereum, which looks like it's going to be very strong as these layer twos and things like Robinhood keep pumping up the demand. In the long term, once you can build fully on chain, you don't need Ethereum, and there are going to be better places to do DeFi on ICP.
Talk to me
I hope that's helpful for you. That's what I'm thinking about in crypto today. If you appreciate this, go to jerrybanfield.com, where you can schedule a call with me, join my chat, and join my Skool.
If you want to get in on those gains on MaxFi, use my MaxFi referral link and deposit. None of this is financial advice.
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